KIRKUK, Iraq (CNN) --A battalion from the 173rd Airborne Brigade has reinforced U.S. troops and Kurdish forces in the northern Iraqi city of Kirkuk, Maj. Gen. Stanley McChrystal said Thursday at a Pentagon briefing.

Truckloads of Kurds have also flooded into Kirkuk after the Kurdish Peshmergas, backed by U.S. Special Forces, entered the city without so much as a shot fired by Iraqi defenders.

The rise of the Kurdish role in coalition operations prompted concern in neighboring Turkey, which fears the oil-rich city could be a start for an independent Kurdish state that would give rise to unrest among Turkey's own Kurdish population.

Turkish foreign ministry sources told CNN plans are being drawn up to send observers to Kirkuk, but it's unclear when or how many officials will be deployed. (Turkey to send observers)

Early Thursday, Kurds crowded into Kirkuk's central square, jubilantly following in the footsteps of Iraqis in the south and north to Baghdad, by toppling a statue of Saddam Hussein and dancing on its broken carcass.

McChrystal said: "The situation (in Kirkuk) is fluid and has been all day."

The 173rd Airborne has more than 1,000 troops in northern Iraq, military sources told CNN, but not all have been sent to Kirkuk.

CNN's Ben Wedeman, in the city, reported it was "very much in the control of the Kurds" and said a U.S. Special Forces-backed, Kurdish-appointed governor was reportedly on his way -- slowed, Wedeman said, by the sheer numbers of Kurds on the road from Erbil to Kirkuk.

The Peshmerga, backed by U.S. Special Forces, pushed into Kirkuk after a steady northern campaign that saw the Kurds take over nearly 300 villages following a near-constant bombing campaign by coalition aircraft.

After coalition aircraft launched their heaviest wave of bombing along the increasingly active northern front early Thursday, the Peshmerga seized control of Kirkuk's northwestern outskirts, where they met little resistance. (Wedeman: 'Little resistance')

With the Iraqi forces gone, residents began looting the area -- including a Pepsi soft drink factory said to be owned by Saddam's son, Uday.

Iraqi forces were "rapidly collapsing" in the face of the Peshmerga-Special Forces advance, CNN reporters said from the region.

Correspondent Kevin Sites ran across a large force of what were apparently Iraqi soldiers who had shed their uniforms and started heading north.

Sites also reported that some Peshmergas had left Kirkuk to round up fleeing soldiers, but set them loose after depriving them of any weaponry they carried.

Thursday's push started northwest of Kirkuk in the town of Altun Kupri. Wedeman reported that Iraqi soldiers retreated and surrendered, many wandering aimlessly around the town. Some of the former Iraqi fighters told Wedeman they were happy to hear Saddam's regime had collapsed in Baghdad.

Farther south, residents of Khanaqin near the Iranian border also celebrated the removal of Iraqi control over their town, CNN's Brent Sadler reported.

"The gravitational effect of the decapitation of the regime in Baghdad 24 hours ago has rippled right up here to the north, as was the hope and the expectation of allied coalition commanders," Sadler said.

Turkish fears

But that ripple effect continued into Turkey, where Ankara bristled, concerned at the possibility of Kurds seeking independence and promoting similar ambitions among its own Kurdish population.

U.S. Secretary of State Colin Powell telephoned Turkish Foreign Minister Abdullah Gul, foreign ministry sources said, and reiterated promises to protect the territorial integrity of Iraq -- clearly meaning no Kurdish state was in President Bush's vision of the future.

Gul told CNN: "So far, (the coalition) took control of Kirkuk. The American soldiers are there and there's no problem. Those Peshmergas, they will leave there. The Americans guaranteed this."

Turkey upset coalition plans for a northern front as the war got under way last month when it refused to allow coalition troops to enter northern Iraq from Turkish territory.

Without the tens of thousands of troops who would have entered from Turkey, U.S. Special Forces have been coordinating the Kurds and other coalition forces.

Turkey has since agreed to allowing overflights for U.S. heavy military equipment into northern Iraq and passage for humanitarian and reconstruction assistance.